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HM Insurance Group Announces Agreement to Acquire Risk Based Solutions

PITTSBURGH – (Oct. 16, 2006) – HM Insurance Group, a Highmark Company, announced today that an agreement has been reached by its subsidiary HM Life Insurance Company to acquire Risk Based Solutions (RBS Re) for an undisclosed amount of cash. RBS Re is one of the leading managers and underwriters of HMO reinsurance in the United States.

“This acquisition will better position HM Insurance Group as a leader in the Excess Loss market. It complements our current strong position in Employer Stop Loss with the addition of equally strong HMO reinsurance capabilities,” said Daniel Lebish, president and chief executive officer of HM Insurance Group. “The RBS Re acquisition strengthens our ability to return value and enhance our competitive position as a health risk solutions carrier for employers and providers.”

“We are excited about being part of an organization with the experience, knowledge and resources of HM Insurance Group,” said Alexander Soria, president of RBS Re. “RBS Re can now offer a range of products and services to help meet the changing needs of our customers in the managed care market.”

HM Life Insurance Company has agreed to acquire 100% of the ownership interests in RBS Re. For the 2006 underwriting year, RBS Re is managing a $33 million block of HMO Reinsurance and Stop Loss premiums.

HM Insurance Group will retain RBS Re staff and resources as a wholly owned subsidiary of HM Life Insurance Company. As such, the new subsidiary will maintain its name, distribution channel, operations and locations.

No further details of the transaction are being released. The transaction is expected to close shortly.

Pittsburgh, PA-based HM Insurance Group provides group health-related insurance products nationally to protect businesses and their employees from potential financial losses associated with health care costs. HM Insurance Group’s connected portfolio of products and services helps to provide health risk solutions for clients. In addition to Stop Loss coverage to protect against catastrophic claims, HM Insurance Group offers Worksite and Limited Benefit Medical group insurance and has regional sales offices in 19 locations.

 HM Life Insurance Company and HM Life Insurance Company of New York have received an “A-“(Excellent) rating from A.M. Best Company, one of the country’s oldest and most respected rating agencies. HM Insurance Group consists of HM Life Insurance Company, HM Life Insurance Company of New York and HM Benefits Administrators. Not all products or services are available in all states.

RBS Re is an integrated reinsurance management company specializing in the direct distribution, underwriting and administration of Stop Loss and Reinsurance products to managed care and self-funded employers. Miami, FL-based RBS Re serves accounts nationally with offices in Boston, Nashville, Denver and Minneapolis.

Contact:
Diane Lewis
HM Insurance Group
(412) 544-0659
diane.lewis@hminsurancegroup.com